The securities watchdog of North Dakota has issued an order of cease-and-desist an ICO (Initial Coin Offering) that’s Russian-based. The ICO is said to have imitated the Liechtenstein-based Union Bank AG and promoted “unregistered and potentially fraudulent securities.”
The commissioner of the North Dakota Securities Department, Karen Tyler, has announced on Monday that the supposed ICO project’s website has copied elements of the website of Union Bank. Union Bank Payment Coin (UBPC) is the name of the project. They have copied the wording, images, leadership information, and style.
A Scam Hiding Behind An ICO Project
Tyler said that the UBPC offered a “stable coin that is fully backed by a fiat currency – the Swiss franc” and has claimed to be the “world’s first security token backed by a fully licensed bank.” UPBC looked to be an effort to help investors defraud. They have based their claims on a blockchain announcement they’ve released in August by the licensed and regulated bank.
While the website of Union Bank’s IP address is placed in Liechtenstein, the location of UBPC is in Russia. It’s also registered to a specific person, according to a statement.
Tyler said in the statement:
“Because ICOs are sold over the internet and pitched heavily through social media platforms, North Dakotans can be exposed to the offers whether the promoter is down the street or on the other side of the glob.”
The commission added:
“Financial criminals continue to cash in on the hype and excitement around blockchain, crypto assets, and ICOs – investors should be exceedingly cautious when considering a related investment.”
This is not the first time an action has been taken by the watchdog against firms that are promoting false ICOs in North Dakota. Just this October, the commissioner has ordered against three firms: Life Cross Coin, Advertiza Holdings, and Crystal Token.
What do you think of this new scam? Do you think that North Dakota’s securities watchdog was right to issue the cease-and-desist order? Let us know in the comments below.
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